According to a recent survey by Bankrate, investment strategists are expecting a slight decrease in Treasury yields over the next year. The Fourth-Quarter Market Mavens Survey revealed that experts predict the 10-year Treasury yield to average 4.14 percent in 12 months, which is higher than the previous quarter’s projection of 3.53 percent. Responses from participants ranged from 3.55 percent to 4.75 percent. The survey concluded on Dec. 13, just before the Federal Reserve’s December meeting where interest rates were cut by 25 basis points, causing an initial rise in Treasury yields, with the 10-year Treasury yielding around 4.49 percent. Currently, the trailing 12-month yield of the 10-year Treasury stands at 4.53 percent. There has been recent uncertainty among investors due to factors such as inflation, monetary policy, and speculations regarding the economic impact of President-elect Donald Trump’s policies on taxes and tariffs. Bankrate’s senior economic analyst, Mark Hamrick, highlights the importance of historical context in understanding how the market might react to the new administration’s policies. Looking ahead, Bankrate’s Market Mavens anticipate a modest decrease in the 10-year Treasury yield over the coming months.
Stovall predicts a 20% increase, maintaining a positive outlook for 2025. Additionally, he anticipates the 10-year Treasury yield to stabilize at 3.55% in the coming year, signaling a balanced economic perspective despite potential market volatilities. Amid uncertainties surrounding Treasury yields and inflation, it is recommended for investors to adopt a long-term strategy in navigating the market. Kenneth Chavis IV, a senior wealth advisor at Versant Capital Management, emphasizes the importance of diversification, a concept often overlooked by many. This sentiment is echoed by Hamrick, who suggests that investors reassess their asset allocation and risk assessment as they embark on a new year. He advises investors to consider questions such as, “Is there a need for adjustments in my portfolio?” and “Can I comfortably maintain my current positions?” Regular reviews of these factors can prevent impulsive or emotional reactions to market changes and ensure alignment with investors’ evolving objectives. It is essential for all investors to conduct thorough research into investment strategies before making any decisions and to bear in mind that past performance of investment products does not guarantee future appreciation.
